PTI
 
New Delhi, Jun 8: Prices of cooking gas, petrol, diesel and kerosene will automatically be increased if global crude prices shoot beyond the 75 dollars-a-barrel mark, with the government giving freedom to oil PSUs for fixing prices.

The ushering in of the free pricing mechanism, which was put on the back burner by the UPA government, is part of the package cleared by the Union Cabinet on Monday, under which petrol and diesel prices were hiked by Rs 4 a litre and Rs 2 resectively to save oil PSUs from certain bankruptcy, informed sources said.

The previous NDA government had dismantled the Administered Pricing Mechansim and for a short while given the oil PSUs power to review fuel pries every fortnight to reflect the global trend.

Every one dollar increase in global crude prices after 75 dollars a barrel, would make petrol dearer by 39 paise a litre, diesel by 30 paise, cooking gas by 67 paise and kerosene by 36 paise.

While the UPA government increased price of cooking gas thrice (when Mani Shankar Aiyar was Petroleum Minister), there has been no increase in kerosene prices since 2002.

The Union Cabinet, on Monday, had spared both the LPG and kerosene from the hike in prices but under the new dispensation, the government or oil companies would not take the burden of surge in international crude prices.